G.R. No. 190389 & 190390, April 19, 2017
Manggagawa ng Komunikasyon sa Pilipinas, Petitioner, vs. Philippine Long Distance Telephone Company Incorporated, Respondent.

FACTS

The labor union MKP filed notices of strike against PLDT, alleging unfair labor practices. The charges included the abolition of a division causing employee redundancy, the outsourcing of jobs to contractual workers, and the planned closure of several regional operator services threatening the job security of over 500 members. MKP went on strike on December 23, 2002. Subsequently, PLDT declared 323 employees redundant, having redeployed others. The Secretary of Labor certified the dispute for compulsory arbitration, issuing a return-to-work order but excluding those terminated due to redundancy. This exclusion was later nullified by the Supreme Court in a related case (G.R. No. 162783), which ordered PLDT to readmit all striking workers.
The National Labor Relations Commission (NLRC), in the compulsory arbitration proceedings, dismissed MKP’s unfair labor practice charges. It found PLDT’s redundancy program valid, implemented in good faith due to technological changes and business decline, and accompanied by proper separation benefits. The Court of Appeals affirmed the NLRC’s decision. MKP elevated the case, arguing the redundancy was a pretext to defeat the workers’ right to return to work following the Supreme Court’s prior order in G.R. No. 162783.

ISSUE

Whether PLDT validly terminated the employment of the 323 employees on the ground of redundancy.

RULING

Yes, PLDT validly terminated the employees. The Supreme Court upheld the findings of the NLRC and the Court of Appeals. The legal logic rests on the established principle that redundancy exists when an employee’s services are in excess of what is reasonably demanded by the enterprise. For a valid dismissal on this authorized cause, the employer must prove by substantial evidence: (1) that the redundancy is real and not simulated; (2) that it was done in good faith; and (3) that fair and reasonable criteria were used in selecting the employees to be dismissed.
The Court found that PLDT satisfactorily discharged this burden. The redundancy resulted from legitimate business necessities, specifically technological advancements (like automation and digitalization) that reduced the need for manual operator services and a decline in demand for certain legacy services. The company demonstrated good faith by redeploying 180 affected employees prior to the declaration. The selection criteria, based on efficiency ratings and tenure, were fair and reasonable. Furthermore, the affected employees received separation benefits exceeding statutory requirements. The fact that the redundancy declaration occurred after the strike and the Court’s return-to-work order in a separate proceeding did not automatically render it illegal or a retaliatory measure. The validity of the redundancy is judged on its own substantive merits, which PLDT adequately proved. Consequently, the dismissal was a legitimate exercise of management prerogative.